I'm in the county town, and you say I'm a big shot?

Chapter 745 "They're playing word games with us; this document is like a codebook with key pages torn out."

Jinghai Bank received the explanatory letter from Goldman Sachs China the next day, close to the end of the workday, and he immediately read it carefully.

Avoiding the important issues and focusing on the trivial, being ambiguous and vague.
However, Fang Qingye knew that this was typical behavior of investment banks like Goldman Sachs.

When he saw the term "CDS", Fang Qingye finally understood.

"So that's what Goldman Sachs does." Fang Qingye smiled and picked up her teacup.

CDS is an abbreviation for Credit Default Swap, which is a bilateral financial derivative contract traded over-the-counter.

In essence, the "buyer" of the contract pays a series of fixed fees to the "seller" in exchange for a promise that the seller will pay compensation to the buyer when a predefined "credit event" occurs with a specific third party (called the "reference entity").

Credit default swaps (CDS) are a double-edged sword. On the one hand, they can help banks and other institutions "insure" their bonds and transfer the risk of default, making banks more willing to lend money to companies and promoting the flow of funds.

But the downside is also fatal: it can easily be used for "betting" or even become a speculative tool!

He looked at it carefully for a while, then picked up the landline and called Chen Danlu in Shanghai: "Goldman Sachs has sent over the letter of explanation. I'll forward it to you. You need to organize your capable team to analyze it immediately tonight. I'll be in Shanghai right away!"

"Ok."

Fang Qingye asked Hu Lingling to fax the explanation letter to the Huangpu branch, and then immediately took a car to Shanghai.

On the way, Fang Qingye called Liu Shuai again to tell him that she had sent an explanation letter, but it was vague and incomplete.

"Hehe. That's normal. I don't have that kind of ability to make the other party obediently reveal their secrets with just a few words." Liu Shuai laughed on the other end of the phone: "Do you need me to invite a financial expert from our bureau to help you? Please do it privately."

"Thank you, but I don't need it for now. I'd also like to see how competent our PhD and Master's degree holders at Jinghai Bank are."

"OK, contact me if you need anything."

"Ok."

Three hours later, Fang Qingye arrived at the Huangpu branch on Dongjiadu Road. The business hall on the first floor was closed, but the office on the second floor was still brightly lit. As soon as he went up to the second floor, a female employee led him into the conference room.

A female employee was already waiting at the door, leading him quickly upstairs. As soon as he pushed open the conference room door, a wave of heat mixed with the smells of tobacco, coffee, and fatigue hit him.

Fang Qingye couldn't help but cough twice. Through the hazy smoke, he saw six or seven people sitting around a long table. Even Chen Danlu, who was usually refined and rarely smoked, had a half-smoked cigarette between his fingers and his brows were furrowed.

"Are you trying to set yourselves on fire? Aren't you afraid of protests from the women?" Fang Qingye broke the silence with a hint of teasing.

"Fang Xing, you've finally arrived! Quickly take care of Chen Xing and the others, I can't stand this place any longer!" Cai Min, the only female member of the team and deputy director of the risk control department, immediately spoke up to "complain," her delicate eyebrows furrowed into knots.

Cai Min was once a returned overseas elite at Citibank Shanghai, and she is also a returned overseas student. Now her office is located in the Pudong branch of Citibank Shanghai.

Currently, some employees from the investment department, credit department, and risk control department of the Jinghai headquarters have moved to Shanghai to work in preparation for the establishment of the second headquarters of Jinghai Bank.

Upon hearing this, Chen Danlu and the others chuckled awkwardly and stubbed out their cigarettes.

"How is it?" Fang Qingye walked to the projection screen and glanced at the dense text on it.

“It’s in progress. The other party’s explanation letter is like a defective product; we need to analyze it and piece it together,” Chen Danlu said, pointing to the explanation letter projected onto the large screen. “They’re playing word games with us.” Cai Min, as the deputy director of the risk control department and a key member of the team, circled “De Shao Group” and “Credit Default Swap (CDS)” that appeared repeatedly in the document.

"This document is like a codebook with key pages torn out."

Cai Min frowned, adjusting her glasses as the laser pointer's red dot hovered over the words "De Shao Group." "They tirelessly told us that this structure was managed by De Shao, and that De Shao hedged the risks, yet they avoided discussing the most crucial question—what risk was this incredibly complex CDS contract actually hedging?"

“I think the answer lies in these two words,” Chen Danlu continued, his finger lightly tapping on the screen for “reference entity” and “cross-contractual breach.” “This is the only key they left behind, but they deliberately blocked the lock.”

Fang Qingye listened carefully, then pondered for a moment: "Since they've given us the key, we must pry open the lock. Concentrate all resources." He decisively ordered: "Then let's launch a full-scale attack based on the clues we can find. First, the transaction trends of the De Shao Group over the past six months. Second, which assets' CDS prices have experienced abnormal fluctuations in the international market. Third, cross-reference all the information."

"OK!"

Everyone immediately got busy again.

Fang Qingye glanced at Gao Pan, who was also busy, but said to Chen Danlu, "Chen Xing, come out for a moment."

The two left the meeting room and went to one end of the corridor.

"How has Gao Pan been performing these past few days?" Fang Qingye asked in a low voice.

“He has been actively cooperating with our work, and he has gradually realized that this financial product is not as perfect as he imagined, and there may be huge traps hidden in it. So today he also participated in the analysis of this explanatory letter,” Chen Danlu said.

Fang Qingye nodded and didn't say anything more, only instructing, "Tell everyone to hurry up, but don't burn out. Make sure there's enough food for midnight snacks, coffee, and tea, and try to smoke as little as possible."

"Ok."

Fang Qingye went into the conference room again, said a few words of concern, and then left by car.

When he arrived home, Bai Ou was gently soothing the child. Seeing him enter with a tired look on his face, she immediately put the child down and went to greet him, taking his suit jacket.

"Have you eaten yet?" Bai Ou asked with concern.

"I put some bread in the car." Fang Qingye rubbed her temples and sat down on the sofa.

"Is there any progress on that letter of explanation?" Bai Ou asked with concern.

“Goldman Sachs’ scheme is not so easy for us to see through.” Fang Qingye leaned back on the sofa and closed her eyes. “Chen Danlu and the others are still working late into the night.”

Bai Ou sighed softly: "The open and hidden attacks in the financial world are truly impossible to guard against."

"That's right. So when playing with financial giants like Goldman Sachs, you have to be on your guard. I'm going to play this game well!"

The next morning, just as dawn was breaking, Fang Qingye was awakened by the urgent ringing of her cell phone.

He touched the phone screen where Chen Danlu's name was flashing. As soon as he answered, Chen Danlu's hoarse, excited voice came from the other end:
"Fang Xing! We've figured it out! This is a massive scheme! Our Jinghai Bank, and those three manufacturing companies... we've all been caught in it!"

(End of this chapter)